The GTR Leaders in Trade awards highlight excellence in the trade, commodity, supply chain and export finance, and fintech markets, recognising pioneering institutions and top performers from around the world. Judging is based on submissions sent to GTR that outline institutions’ greatest achievements throughout the course of 2019*. Congratulations to the winners!
*The names listed under each category are based on submissions sent to GTR. In some cases, where entries overlap with Best Deals signed in 2019, GTR also draws on those transactions.
Regional awards
Best trade finance bank in:
East Africa:
Shortlisted nominees: FCMB Bank (UK), Standard Bank
Winner: Standard Bank
West Africa:
Shortlisted nominees: BACB, FCMB Bank (UK), The Access Bank UK, Zenith Bank (UK)
Winner: Zenith Bank (UK)
Southern Africa:
Shortlisted nominees: RMB, Standard Bank, Zanaco
Winner: RMB
Middle East:
Shortlisted nominees: Bank ABC, Citi, Emirates NBD, FAB, HSBC, Standard Chartered
Winner: Standard Chartered
North Africa:
Shortlisted nominees: Arab Bank, BACB, Citi, HSBC
Winner: BACB
North America:
Shortlisted nominees: Bank of America, Citi, Santander
Winner: Bank of America
Latin America:
Shortlisted nominees: Citi, Santander
Winner: Santander
East Asia & the Pacific:
Shortlisted nominees: ANZ, DBS, Mizuho
Winner: Mizuho
South Asia:
Shortlisted nominees: ADB, DBS, HSBC
Winner: ADB
Eastern Europe:
Shortlisted nominees: Sberbank, Ukrgasbank, VTB Bank
Winner: Sberbank
Western Europe:
Shortlisted nominees: Commerzbank, Crédit Agricole, ING, Nordea, Santander
Winner: Crédit Agricole
UK:
Shortlisted nominees: Barclays, HSBC, Lloyds Bank, NatWest, Santander
Winner: NatWest
Global awards
Best trade finance law firm:
Shortlisted nominees: Allen & Overy, Hogan Lovells, Norton Rose Fulbright, Sullivan
Winner: Sullivan
Best export credit agency:
Winner: UK Export Finance
Best technology collaboration:
Shortlisted nominees: Crown Agents Bank, Euro Exim, Incomlend, MineHub, Pole Star & Dow Jones
Winner: Euro Exim
Best fintech startup:
Shortlisted nominees: Incomlend, Trade Ledgers, TradeSun, Tradewind Markets
Winner: Incomlend
Best fintech disrupter:
Shortlisted nominees: Demica, Incomlend, Traydstream
Winner: Demica
Best trade finance software provider:
Shortlisted nominees: CGI, China Systems, Orbitt
Winner: China Systems
Best alternative trade finance provider:
Shortlisted nominees: Demica, ExWorks Capital, London Forfaiting Company (LFC)
Winner: London Forfaiting Company (LFC)
Best trade credit and political risk insurance underwriter:
Winner: Chaucer
Best trade credit and political risk insurance broker:
Shortlisted nominees: BPL Global, Marsh JLT Specialty, Texel, Willis Towers Watson
Winner: Marsh JLT Specialty
FI that has made a significant contribution to sustainability:
Shortlisted nominees: ABN Amro, Barclays, EBRD, HSBC
Winner: EBRD
Most innovative bank:
Shortlisted nominees: ADB, BNP Paribas, Deutsche Bank, NatWest
Winners: BNP Paribas, Deutsche Bank
Best supply chain finance bank:
Shortlisted nominees: Bank of America, Citi, MUFG, Standard Chartered
Winner: Citi
Best commodity trade finance bank:
Shortlisted nominees: ABN Amro, Société Générale
Winner: Société Générale
Best export finance bank:
Shortlisted nominees: BNP Paribas, SMBC, Standard Chartered
Winner: Standard Chartered
Best trade finance bank:
Shortlisted nominees: Citi, Crédit Agricole, HSBC, Standard Chartered
Winner: HSBC
Best trade finance bank in East Africa: Standard Bank
Standard Bank has secured the top spot in this category for the second year running.
“As Africa emerges onto the global economic stage, and trade activity into, across and out of the continent increases, organisations are looking for a transactional banking partner with the experience and capability to execute their working capital and risk mitigation requirements,” the bank says in its submission.
Standard Bank is renowned for its historic and wide-ranging footprint across the African continent. It is present in 28 African countries, including key East African markets Kenya, Tanzania and Uganda. The bank’s local knowledge and capabilities are complemented by its global reach with teams operating in major financial centres such as London, New York, Dubai and Beijing. In terms of the group’s trade finance statistics, it offers open account and documentary trade product capability in as many as 19 African markets. The bank currently has 315 supply chain finance clients – a significant increase on the 252 recorded the year before.
One of the bank’s many landmark deals signed last year and sent to GTR to back up its submission included a US$5mn structuring and execution of a receivables discounting solution for an oil and gas trading company operating in Tanzania and across Sub-Saharan Africa.
GTR also recognises Standard Bank’s efforts in its support of trade digitisation. It was the first African bank to sign up to both of the Marco Polo and Contour trade finance blockchain consortia.
Best trade finance bank in West Africa: Zenith Bank (UK)
Zenith Bank (UK) broke new ground in 2019. Expanding beyond its core markets in Nigeria, Ghana, Gambia and Sierra Leone, the bank conducted trade transactions in excess of US$2bn between West Africa and 69 countries around the world.
The bank says it handled trade transactions worth between US$5,000 and US$40mn, while growing its letter of credit business by 30% year-on-year.
In terms of trade products, Zenith Bank (UK) was already diverse, offering correspondent banking payments, bills of collection, forfaiting, guarantees, secondary market participations and distribution, as well as loan syndications, club deals, escrow, and vessel and aircraft financing and insurance.
In 2019, however, it developed a new bulk payment solution from scratch, on behalf of a key trade finance client. The solution allows the client to send the bank a single bulk sum which could then be redistributed to hundreds of beneficiaries offshore.
Launched in June, the product allows 24-hour turnaround of expatriate payments without the need for manual intervention, putting an end to the client’s need “to work late into the night on a daily basis and at weekends”, the bank says.
While allowing the client to expand its capacity, the development also led to significant growth in Zenith Bank (UK)’s payments business. It is believed to be the first and only bank offering such a solution to selected customers in the Nigerian market.
Best trade finance bank in Southern Africa: RMB
Rand Merchant Bank (RMB) is the worthy winner of this category for the third year in a row. “Our client-centric approach coupled with our capabilities and expertise are the reasons why we have been recognised by various industry bodies’ accolades over the past couple of years,” the bank tells GTR.
Some of the RMB trade and working capital team’s most notable achievements for 2019 include the fact that its trade business revenue grew 22% for the financial year ended June 30, despite the South African market growing at less than 1%. It also substantially improved the quality of earnings across all products due to an increasingly diversified asset base.
In just over three years, the bank has become the leading provider of supply chain finance (SCF) solutions in South Africa, based on the number of SCF programmes implemented, and has the ability to work with multiple platforms. The value of invoices discounted grew at 200% for the 2019 financial year.
In 2019 the bank also launched its new trade finance front-end system, eTradePort, enabling its clients in South Africa – as well as Nigeria – to transact and view all trade instruments for the first time.
It is worth noting that the bank submitted a number of GTR Best Deal-worthy transactions – many of which were firsts in the African market – in support of its submission as best trade finance bank in Southern Africa. Because GTR was not permitted to disclose all the details of these deals, as requested by the bank so as to protect its intellectual property, they were not formally awarded Best Deal status. They were, nevertheless, taken into consideration for the bank’s win in this category.
Best trade finance bank in the Middle East: Standard Chartered
Standard Chartered retained its crown for the second year in a row for its region-wide presence and support of Middle Eastern trade and businesses.
With offices in Bahrain, Iraq, Jordan, Lebanon, Oman, Qatar, Saudi Arabia and the UAE, the bank remains committed to the Middle East. It also holds a significant client base in other markets in the region, managed out of its UAE hub.
Standard Chartered is investing in female entrepreneurs in the UAE. In June 2019, it announced the launch of a Women in Tech global programme aimed at supporting female tech entrepreneurs. The scheme promotes the economic and social development of female business leaders in the country through innovation or technology-focused entrepreneurship.
Further supporting UAE businesses and people, Standard Chartered signed an agreement with Etihad Credit Insurance (ECI), the UAE’s export credit agency, to provide finance and trade credit solutions to UAE businesses that are aiming to establish their presence regionally and globally.
“We differentiate ourselves through our global network and strong product capabilities, including a complete suite of Islamic banking products which are supported by sophisticated structuring capability for complex cross-border deals,” reads the bank’s submission.
The bank has also impressed in its ability to be flexible and proactive in changing market conditions, focusing on technology innovation, process streamlining and faster turnaround times to ensure better client experiences.
Best trade finance bank in North Africa: BACB
Providing trade finance in some North African markets, including Sudan and Libya, is risky. The British Arab Commercial Bank (BACB) has overcome these challenges, supporting trade across all of North Africa.
“BACB is one of the few banks that operates in all six countries in North Africa, having an extensive correspondent banking network and a strong risk appetite supported by on-the-ground knowledge and expertise,” reads the bank’s submission.
One of BACB’s 2019 deals involved it financing a US$110mn facility for the import of wheat and medicine in Sudan. BACB is also the sole UK issuer of letters of credit (LCs) for corporates working in the Libyan oil sector; the bank operates a receivables finance product for Libya’s state-owned oil company, National Oil Corporation.
“BACB has successfully navigated significant challenges to continue working in both Libya and Sudan, maintaining substantial market shares in both countries and providing crucial support to those nation’s economies given de-risking of those markets by peer institutions,” the bank continues.
In 2019, the bank handled more than 900 LCs issued by banks across North Africa and saw transaction flows in excess of US$21.4bn from the region.
In total, BACB distributed US$68mn of North African trade assets into the international market in 2019; these were primarily Algerian assets but also included transactions from Egypt and the Maghreb countries of Tunisia, Libya and Morocco.
BACB’s North African trade assets stood at US$421.6mn at the end of 2019, representing 38% of the bank’s total trade assets.
Best trade finance bank in North America: Bank of America
An unpredictable geopolitical landscape and shifting supply chains brought new business challenges to organisations across North America last year. While many global banks continued to focus on large corporates, Bank of America put its focus squarely on supporting midsized companies, which makes it a worthy winner of this year’s award.
In its efforts to support smaller firms in expanding their global presence, the bank has rolled out several new supply chain finance programmes as well as expanding existing ones, resulting in a year-on-year SCF asset growth of 17%. To help its clients make more informed decisions in their trading relationships, it has also enhanced the data insights it provides, with the launch of an accounts payable optimisation product to enable companies to determine the most efficient payment method for each supplier.
In a year in which the fate of US Exim remained uncertain, Bank of America re-launched its export and agency finance business to focus on customised debt and working capital solutions, receiving several financing mandates in the region to support trade.
Meanwhile, with an annual US$3bn new technology initiative fund, the bank has long been a leader in the region when it comes to digital innovations – a position it consolidated last year when it joined the Marco Polo project for open account trade finance. “Joining the Marco Polo Network supports our strategic objective of turning technology advances into trade solutions that address client needs,” says Geoff Brady, Bank of America’s head of global trade and supply chain. “We look forward to exploring how the new technology can generate greater transparency for our clients throughout the transaction lifecycle, making traditionally paper-based, opaque processes easier and more efficient.”
Best trade finance bank in Latin America: Santander
Santander has a long history in trade finance in Latin America, and is by far the region’s largest bank, with a strong presence in the economic hubs of Brazil, Argentina, Chile, Mexico and Uruguay. With over 50,000 employees located in Latin America, the bank has a deep knowledge of the local regulatory and business environment, which – combined with access to international markets throughout the global Santander network – provides an unparalleled trade finance service to its clients.
“We are continuously working not just to maintain our position, but to increase it throughout the near future by propelling business with new clients, and also substituting our systems in order to reduce manual processes and make clients’ experience more efficient,” the bank says.
In 2019, the bank played a leading role in import letters of credit in Brazil’s retail and industrial segment, reaching a market share of 49.5%. In Mexico, the bank holds 30% of the market in standby letters of credit, and in Argentina it has reached the top of the central bank’s league table of banks in the country.
Santander has been involved in numerous ground-breaking trade finance deals across the region, and 2019 was no exception.
A US$71mn buyer credit facility for Colombian bus rapid transit system Transmilenio in March was the country’s first long-term, synthetic Colombian peso, cross-border export credit agency deal, and paves the way for similar deals in the coming years.
Best trade finance bank in East Asia & the Pacific: Mizuho
Mizuho is the winner in this category for the second year running, having helped structure noteworthy deals across the breadth of Asia, while boosting its presence as a transaction banking institution on the continent.
The bank focuses on Asia and the Mekong region, and in 2019 it added a desk in Yangon, Myanmar, to its transaction banking franchise.
In 2019 Mizuho also grew its short-term trade finance offerings, expanding its risk mitigation capabilities in the letter of credit (LC) business across Asia Oceania.
The bank says that by tapping into its longstanding relationships with major export credit agencies and multilateral finance institutions, it helped structure “innovative financing solutions in difficult markets”.
As an example of one of these solutions, closed in 2019, it was involved in the financing of a new gas-to-liquid plant in Uzbekistan, which also involved participation from the Export-Import Bank of Korea (Kexim), Korea Trade Insurance Corporation (K-sure) and the Russian export credit agency (Exiar).
Commenting on the deal, Mizuho says: “This project is considered a landmark deal for the region and, with a total syndication amount of US$2.3bn, is one of the largest financings in Central and Eastern Europe in recent years. It will contribute to expanding Uzbekistan’s capacity for high value-added processing of natural gas and dramatically reduce imports of hydrocarbons.”
On the technology front, Mizuho continued to partner with several fintech companies and blockchain consortia in 2019, both for domestic projects and international alliances. For the past few years the bank has been working to streamline paper-intensive trade finance processes.
Best trade finance bank in South Asia: Asian Development Bank (ADB)
The Asian Development Bank (ADB) beat off strong competition to win the best trade finance bank in South Asia award.
The bank’s Trade Finance Programme (TFP) supports exporters and importers in Asia by issuing guarantees and loans to over 200 banks. Operating in 21 countries in total, the TFP is most active in Armenia, Bangladesh, Pakistan, Sri Lanka and Vietnam.
Last year, it supported US$5.4bn-worth of trade through 4,800 transactions, with over 80% of these providing backing to SMEs.
Such financing aims to boost economic growth and create jobs, helping to lift people out of poverty and improve living conditions, which the ADB notes is one of the 17 UN Sustainable Development Goals (SDGs).
The bank also worked to narrow the gender gap, another one of the SDGs, by analysing the human resources policies of 19 of its partner banks. The ADB subsequently recommended enhancements to attract, retain and promote women in banking. To date, 12 partner banks have adopted 25 recommendations.
Meanwhile, in 2019 the ADB also sought to streamline anti-money laundering (AML) measures by publishing two AML/transparency-related publications.
As identified in another paper released by ADB last year – its annual Trade finance gaps, growth, and jobs survey – measures implemented to combat money laundering and the financing of terrorism are “important contributors to the US$1.5tn global trade finance market gap”.
By working with the regulatory community and commercial banks to streamline AML regulations, the bank says it is seeking to close market gaps, while also improving transparency and the fight against crime.
Best trade finance bank in Eastern Europe: Sberbank
A first-time winner, Sberbank’s total volume of trade finance deals topped US$29bn during the first 11 months of 2019. That is a record not only for Sberbank, but for any major competitor. Within Russia, the volume of deals involving Sberbank-issued letters of credit totalled US$15.8bn over the same period.
Sberbank’s most pioneering work was in technology, however. In early 2019, the bank added new functionality allowing corporate customers to initiate the opening of a letter of credit (LC), track the full details of a deal, send the necessary documents and seek financing through its Sberbank Business Online service.
Over half of its corporate clients have already been migrated to the new service, citing it as a convenient and efficient way of managing LC issuance and document flow.
In the real estate market, Sberbank has also simplified how LCs are handled. Targeting developers, realtors, sellers and buyers, the bank is now able to issue an LC in under 10 minutes and post payment within a day. Balances in its Russian real estate business totalled more than US$902bn across 27,000 opened escrow accounts.
SberAPI, an application programming interface (API) built by the bank that lets clients integrate in-house systems with Sberbank services, expanded during 2019. The use of SberAPI for letters of credit was launched in April, and pilot testing its use for escrow accounts started towards the end of the year.
The bank is also actively using distributed ledger technology (DLT), using a DLT-based solution to purchase receivables from oil trader Trafigura in a September deal.
Best trade finance bank in Western Europe: Crédit Agricole
Winning for the second year running, Crédit Agricole has continued to pioneer the use of technology in trade finance.
The bank’s submission emphasises that it is “actively investing in digital transformation”. In 2019, that included the launch of DocChain, a Crédit Agricole-branded guarantee issuance product built on blockchain technology, and the implementation of robotic process automation in its credit processing systems.
Notably, the high-profile komgo platform – of which Crédit Agricole is a founding member – which GTR reported went live at the start of 2019, using blockchain technology to digitise and streamline trade and commodity finance.
The bank is also a participant in Marco Polo, a blockchain-based trade and working capital finance network that in December completed a seven-week-long trial involving over 70 organisations and corporates from more than 25 countries.
Crédit Agricole emphasises its global approach to trade finance. In terms of deals, the bank issued guarantees for infrastructure contracts under China’s Belt and Road initiative, involving multiple countries in Asia, Europe and the Commonwealth of Independent States.
It also arranged and led a syndicated receivables programme in North America worth over US$1bn, and customised open account financing products in local currency in Brazil, India, South Korea and China.
At the same time, Crédit Agricole has continued to expand into emerging markets. In 2019 it set up a regional office in Dubai and new office in Qatar for business in the Middle East and Africa, while bulking out its presence in Colombia, Chile and Indonesia.
In terms of sustainability, the bank started phasing out coal financing as part of a comprehensive plan to overhaul its investment policies towards fossil fuels.
Best trade finance bank in the UK: NatWest
NatWest has scooped this award after a significant expansion to its global reach in 2019, alongside a substantial investment in building a digital trade ecosystem, supporting UK exporters and helping firms prepare for Brexit.
The bank increased the jurisdictions it serves by 15%, as it sets out to help customers look beyond the UK for growth. With pressures on international trade and geopolitical uncertainty, NatWest increased its Growth Fund reserve to £6bn while encouraging continued international trade and preparations for Brexit.
Its submission emphasised growing support for UK exporters, including the facilitation of bond, guarantee and loan export contracts with UK Export Finance (UKEF) that totalled £1.5bn, driving year-on-year increases in trade contracts issued. NatWest also authored UKEF’s operational scheme handbook.
In 2019 it handled more than 3,000 export letters of credit, while collecting more than 10,000 international trade payments for UK firms selling goods and services overseas. At the same time, NatWest grew its involvement in the supply chain and receivables market, discounting over £12bn of receivables and supporting more than 2,000 suppliers in 29 jurisdictions.
Digitising trade has also emerged as a priority for NatWest. As a founding member of the R3 consortium, NatWest says it is pioneering the adoption of distributed ledger technology (DLT) through the Marco Polo and Voltron platforms. It also accelerated the development of an end-to-end DLT platform for trade finance in 2019, offering customers a simpler and more efficient experience.
Best trade finance law firm: Sullivan
With the largest dedicated practice in trade finance at any law firm, London-headquartered Sullivan has scooped this award for the second year running. With a focus on developing markets, the firm advises more than 50 major trade finance banks and financial institutions, as well as funds, corporate borrowers, agents and trustees, international organisations and insurers.
Sullivan says its workload in 2019 was “exceptional” in terms of geography, the range of commodities and the number of transactions on which it advised clients.
Highlights include advising Santander and Deutsche Bank on a UK Export Finance-guaranteed financing for the development of Ghana’s Kumasi Airport, and a major international bank on the construction of the Aflao Toll Road. It also supported an Eritrean off-grid power provider financing the development of a sulphate and potash energy project, and a large international bank seeking warehouse, pre-shipment and export financing for a Kenyan tea producer exporting to the Middle East and Asia.
Sullivan worked with Afreximbank on the structuring and documentation of a variety of trade finance, asset finance and letter of credit facilities across Africa, including the supply of buses into Egypt and the provision of electricity in the south of the continent.
Technology continues to play an important part of the firm’s work, advising Satoshi Systems Limited on the creation of a trade finance platform that uses machine learning and artificial intelligence to help SMEs secure funding.
On more technical matters, Sullivan advised the International Trade and Forfaiting Association on the high-profile launches of a new unfunded master risk participation agreement, as well as on revised guidelines for non-payment insurance policies.
Best export credit agency: UK Export Finance
UK Export Finance (UKEF) wins this award for the second time in a row after a landmark year: 2019 marks a century since the London-based export credit agency was founded. UKEF provided a total of £6.8bn in support for UK exporters last year, of which 79% was for SMEs.
One of its crowning achievements in 2019 was the launch of a new general export facility in March, aimed at supporting firms’ overall working capital requirements. UKEF says this will help a wider range of exporters access its support, including smaller firms and those with shorter manufacturing cycles.
The facility can also support larger firms, however. In July, Jaguar Land Rover announced it had been granted a £500mn UKEF guarantee to support the development of next-generation electric cars – vital support to a sector that accounts for 12% of the UK’s total exports.
Sustainability remains a central part of UKEF’s vision. It supported Solarcentury’s construction of two solar plants in Spain, which will have the capacity to power more than a quarter of a million homes with renewable energy, as well as providing £230mn for the construction of the Formosa 2 wind farm in Taiwan.
UKEF also supported a £130mn project in Ghana to develop a market, airport and hospital, an agriculture project in Angola and a bridge construction effort in Sri Lanka – infrastructure improvements it says will have “a transformative effect” on communities while underpinning future growth.
Closer to home, UKEF notes that the country’s businesses are preparing for life outside the European Union, and vows to remain “on the frontline of the UK’s trade policy”.
Best technology collaboration: Euro Exim Bank
Euro Exim Bank wins this award for leveraging cryptocurrency, implementing blockchain-enabled distributed ledger technology (DLT) and artificial intelligence (AI) into its trading platform for compliance, and recognising the importance of continuously improving its internal systems.
Innovative technologies, including blockchain and AI, are becoming an essential part of the IT and operational infrastructure of financial institutions. The St Lucia-based bank has embraced this, building its own blockchain-enabled trade platform, Simplex, designed to cover the entire trade process and make compliance more efficient.
The bank has also impressed with its adoption of xCurrent, Ripple’s real-time messaging system, and XRP, a virtual currency used to represent the transfer of value across the Ripple network.
“As an early adopter and participant with Ripple, we are servicing clients through cryptocurrency and real-time network connectivity. This is providing frictionless payments and on-demand liquidity using XRP cryptocurrency as the underlying digital asset for value transfer,” the bank’s submission reads.
“Our dedicated IT team has created future-ready client facing and internal trade platforms, and whilst there is a fine line between being a fintech company and a bank we believe that modern banking can only succeed through adaptation of traditional processes and integration of disruptive technologies.”
Best fintech startup: Incomlend
Incomlend has scooped this award for making private capital available to businesses on a global scale, as well as inking a strategic deal with a major logistics company.
The invoice finance platform provides cross-border factoring and supply chain finance by leveraging an international pool of institutional investors. The marketplace funds invoices in global currencies such as US dollar and euro, with the average funding time for an invoice less than 24 hours.
In October 2019 the fintech announced a deal with shipping and logistics company CMA CGM that makes factoring and supply chain finance available to exporters and importers across CMA CGM’s network, which spans 160 countries.
Through the platform, called Shipfin Trade Finance, the logistics group’s clients can digitally register and undergo an automated due diligence process, trade through finance applications, monitor finance activity through dynamic dashboards and manage their cash online.
Founded in 2016, Incomlend has processed more than 2,300 trade deals to date, onboarding over 450 suppliers and buyers. It currently has a presence in 50 countries across the world.
“With its global online trade finance offer, Incomlend has quickly become a solid finance alternative to traditional lenders. Through Incomlend, traders can diversify funding sources and improve cash flow without burdening their balance sheet or going through complex and lengthy facility approvals. Investors can access a new asset class uncorrelated to financial markets,” says its submission.
Best fintech disrupter: Demica
This award is given to working capital solutions provider Demica for its upgraded offering, substantial growth, and positive impact on the digitalisation of trade.
Demica launched its new receivables finance platform in June 2019. Growing at 40% per annum and with over US$12bn of working capital assets under administration, the Demica platform provides reporting and payment support services to the world’s largest trade receivables banks and investors. “This new release enables our partner banks to configure their own transactions through the use of powerful new tools and applications,” it said at the time.
The platform includes new online dashboards to enable corporate treasurers and internal bank users to view the real-time performance of receivables finance transactions and underlying portfolio data down to the invoice level.
The new release also allows banks to go beyond trade receivable securitisation structures and configure the full range of receivables purchase structures using credit insurance if required. Granular reporting showing discounts and fees on an invoice level supports optimal accounting treatment for clients and risk distribution for funders.
This development follows extensive investment in the company’s supply chain finance platform.
“The launch of our new receivables finance platform is a significant milestone for us. Taking advantage of over 15 years’ experience working with the world’s leading trade banks, we have delivered a unique platform able to transform the customer experience for both large multinationals and banks,” said Demica CEO, Matt Wreford, at the launch.
Demica’s progress has been reflected in the company’s expansion, which saw its London team move to a bigger office to house several new hires in October.
Best trade finance software provider: China Systems
Integrating and innovating trade finance is no easy task. China Systems scoops this award for continuing to do this, supporting the trade finance industry on its journey to digitalise.
Transactions involving high-value goods require processing within a matter of hours rather than days, putting pressure on banking technologies to match these demands. China Systems’ product portfolio makes this possible, enhancing efficiency from the customer front-end through transaction processing to integration with other systems.
Its back-office Eximbills Enterprise (EE) solution, the flagship product of China Systems, provides support for e-commerce, open account and trade-related services. Meanwhile its Customer Enterprise (CE) product is an adaptable solution that provides bank clients with a convenient and secure single window for processing and enquiring on all their trade transactions.
The software provider has impressed with its progress in the Middle East, reporting that Emirates NBD had rolled out Eximbills Enterprise to more regions and with new functionality and that new Islamic banking modules were added to EE and CE.
Away from its own software, China Systems is also working on other projects, teaming up with fintech company Traydstream on the integration of its optical character recognition (OCR) system for document checking.
Best alternative trade finance provider: London Forfaiting Company (LFC)
Alternative trade finance providers continue to play an important role in supporting exporters and importers, particularly in emerging markets, where traditional lenders might in some instances be too risk averse.
London Forfaiting Company (LFC) has become a major player in the sector since its launch in 1984. LFC provides various trade-related finance products, and in the past few decades has developed “extensive country risk capacity”. This allows it to offer alternative financing solutions to exporters and importers trading in markets the world over.
In 2019 it purchased over US$600mn of transactions for its asset portfolio, incorporating 40 different countries, primarily in emerging markets.
The firm says: “LFC’s knowledge of foreign markets plus a strong shareholding structure through the Kipco Group of companies, provides access to extensive commercial and international banking businesses throughout Mena and Europe. In addition, LFC’s offices in London, New York, São Paulo, Paris, Cologne and Moscow, and dedicated Turkey, Bangladesh and China desks, provide a truly global forfaiting and trade finance reach.”
The bank says its ability to provide tailored financing structures to disparate clients, with varying needs, is key to its success. In 2019, LFC concluded a number of innovative financing structures in difficult jurisdictions, most recently Niger.
LFC moved to larger head office premises in London in 2019, and also added additional marketing and coverage staff in many of its operating centres to meet growing client demand.
Best trade credit and political risk insurance underwriter: Chaucer
Having last won this award in 2017, Chaucer once again proved its credentials as a leading underwriter for trade credit and political risk insurance last year.
In 2019, the firm continued to provide support for trade across the world, especially in developing nations.
In one notable transaction, it paid out as the lead insurer on a US$40mn claim for a Caribbean oil import company that defaulted on its obligations. “This was a great outcome for the insured and its financing banks,” Chaucer says.
The firm says it aims to be “one of the foremost trade credit and political risk teams in the London market, and to achieve this, we are committed to leading over half of the transactions we underwrite for clients”.
It adds: “Integral to our approach are our claims experts who, working in partnership with our underwriters, lead diligent negotiation and settlement of many of the key claims that surface in our market. For example, our in-house expertise in the former Soviet Union enabled us to help clients get claims paid in the Ukraine in 2019. We were then able to help them with recoveries as well.”
Chaucer has also been set up as an insurer and reinsurer in Dublin since 2017, and the firm says its Irish business is “writing more credit risk business”.
One reason for this, it says, is the financial support of its parent company China Re. Chaucer adds that the acquisition by China Re in late 2018 has also driven new trade credit opportunities in China and countries involved in its Belt and Road Initiative.
Best trade credit and political risk insurance broker: Marsh JLT Specialty
April 2019 saw Marsh & McLennan Companies (MMC) finally complete its acquisition of insurance broker Jardine Lloyd Thompson (JLT) for US$4.6bn.
Following the takeover by the world’s largest insurance broker and consultancy firm, 10,000 JLT workers moved over to the company.
Meanwhile, it led to the coming together of JLT and Marsh’s speciality teams to form the new Marsh JLT Speciality business.
This served to boost analytical capabilities, while also helping expand Marsh’s global footprint and scale in the UK, Australia and key emerging markets in Latin America and Asia.
According to MMC, the unit offers “expertise, global services and data-driven insights to clients across seven global specialties”.
These include aviation, credit specialities, financial and professional services, construction, energy and power, as well as the cargo and marine sectors.
Marsh had a busy year on the technology front also, working with fintech LiquidX and underwriters Euler Hermes and Atradius to launch a new digital marketplace for trade credit insurance.
On the platform, which went live in March 2019, financiers and corporates are able to request insurance with multiple underwriters through an online process.
Meanwhile Marsh also began piloting the Risk Exchange platform. Powered by blockchain, it is seeking to transform the insurance placement process.
Speaking at the time of the launch in September last year, Marsh JLT Speciality’s global credit specialities leader, Nick Robson, noted: “By digitising the invoices, payments, and other trade and insurance documents of the parties involved, we can streamline the trade credit insurance placement process, drive efficiencies, and improve the overall buying experience.”
FI that has made a significant contribution to sustainability: EBRD
For the first time, the European Bank for Reconstruction and Development’s (EBRD’s) Green Trade Facilitation Programme (Green TFP) has won the Leaders in Trade award for its significant contribution to sustainability in trade.
The Green TFP allows partner banks under the EBRD’s Trade Facilitation Programme (TFP) to use their existing TFP facilities for the financing of exports, imports and the local distribution of imported green technologies and materials, in line with the bank’s Green Economy Transition approach.
Since 2016, the Green TFP has supported almost 900 foreign trade transactions involving trade in higher performance technologies and materials with a total volume of €675mn – as much as €250mn in 2019 alone – across 22 economies where the EBRD invests. These resulted in annual energy savings of 1,513,200 MWh, water savings of 1,681,399 m3 and emission reductions of 605,376 tonnes, CO2 equivalent.
Green TFP transactions to date include the import of wind power generation equipment from Denmark to Ukraine, the import of small-scale combined heat and power technologies from Italy to Lebanon, the import of water-saving bottling lines from Germany to Armenia and from France to Tunisia, and the export of sustainably sourced wood products from Romania to Egypt.
“We are very proud of this recognition for our pioneering Green TFP, which uses the well-established mechanisms of trade finance in support of supply of goods and technologies needed in addressing climate change,” says EBRD first vice-president Jürgen Rigterink. “In the current coronavirus crisis it is critical to keep trade flowing and it is also a stark reminder not to ignore the continuous need to support transition to a green economy.”
Most innovative bank: BNP Paribas
For BNP Paribas, innovation lies at the core of its business model, and is a crucial element of its development plan.
“Innovation is essential when it comes to reinventing our relationship with our customers,” the bank says in its submission, and to that end is building what it calls an “innovative ecosystem” which involves a variety of internal and external initiatives that includes teaming up with startups, fintechs, midsize businesses and major corporations.
The bank was involved, and played a leading role, in a number of digital initiatives in 2019, including the Contour (previously called Voltron) and Marco Polo trade finance blockchain consortia, the Trade Information Network multi-bank platform, and the komgo blockchain platform for commodity trade finance.
The bank has a trade finance innovation forum, which gathers a number of people globally, and evaluates all of its own initiatives as well as others in the industry.
But BNP Paribas’ innovation is not limited to its digitalisation efforts, and it is widely recognised as being at the forefront of sustainability in the trade finance industry.
“BNP Paribas’ tagline is ‘the bank for a changing world’, and there is a true belief that we cannot be successful in a world that is not successful, and that we have a role to play in society. Clients are demanding further progress on the sustainability front, and we have been involved in a number of key trade finance deals, which were tailored to specific clients or situations,” says Jean-Francois Denis, BNP Paribas’ global head of trade solutions and network management.
Throughout the course of 2019 the bank was involved in the Trado project, a new model for blockchain-enabled sustainable supply chain finance, led by international banks, corporates and technology startups.
Most innovative bank: Deutsche Bank
Innovation is often borne out of necessity, and the 2008 financial crisis drove a number of innovations in trade finance as bank-intermediated activity fell in value and credit limits tightened.
At Deutsche Bank, one of the most shining examples of consistent innovation is its distribution and credit solutions, securitisation and repackaging team, led by Guy Brooks, whose idea it was to create a dedicated distribution and repackaging function, which in the last few years has evolved into one of the most entrepreneurial teams within the trade finance market.
According to the bank’s submission, the team possesses the most diversified de-risking capabilities under the same roof in comparison to any other bank. “Not only do they have a best-in-class bank syndication team, but they also have a trading book that manages all their CDS positions, interacts with the secondary market, and fair values large pieces of the trade finance book.”
The team manages the single name repack trades as well as the Trafin platform, the collaterised loan obligation programme used to manage credit and capital relief. At the beginning of 2019, the team set up a JV with the institutional client group, based in the investment bank, that now allows them to access the global investor base for institutional and alternative investors.
The submission adds: “These capabilities make it possible for the team to provide balance sheet optimisation, capital relief, liquidity and a means of reducing concentration risk all in one place. While the bank doesn’t have the largest trade finance balance sheet compared with some of our competitors, these diverse de-risking techniques allow us to punch well above our weight and provide our clients market-leading solutions in a size and volume that meets their needs.”
Best supply chain finance bank: Citi
While global organisations face no shortage of business challenges, the complexities of optimising working capital and managing a global supply chain continue to rise on many companies’ priority lists.
With over 17 years of experience in supply chain finance (SCF), Citi already supports tens of thousands of clients and their suppliers.
But what really made Citi stand out in the annual Leaders in Trade awards was the upgrade to its Citi Supplier Finance offering that it carried out last year.
Through the new platform, clients can access a total view of transactions to make more informed working capital decisions, as well as tap into a suite of robust payment tools spanning supplier finance, dynamic discounting and commercial card solutions. “This comprehensive package allows companies to increase cash flow, generate returns, reduce costs, support suppliers and minimise risk within their supply chain,” the bank says.
The system also now includes Citi’s WorldLink Payment Services system, which enables clients to transact across multiple major currencies for settlement, giving them a competitive advantage during trade negotiations.
With all of this available under a single programme framework which links seamlessly into corporates’ in-house ERP systems, Citi has addressed a major pain point in SCF adoption – that of disjointed processes between procurement and payment. Its new offering makes it easier for buyers and suppliers alike to seek out mutually beneficial early payment opportunities, helping to keep trade moving in straitened times.
Best commodity trade finance bank: Société Générale
Société Générale set itself apart with a focus on ESG in commodities in 2019, despite a tough year as volatile prices and the impact of tariffs pressured exporters. It was involved in all four of the GTR Best Deals in sustainability-linked transactions, demonstrating the breadth of its expertise in providing creative solutions to clients as they seek to respond to the challenges of climate change and the transition to a low-carbon economy.
The bank kicked off its work in bringing in incentivising mechanisms for soft commodities and metals clients in March, acting as sustainability co-ordinator, bookrunner and mandated lead arranger on a US$300mn trade finance facility for the Ghana Cocoa Board. The margin on the facility is based on Cocobod achieving performance targets, from the empowerment of female farmers to increased sensitivity to child labour among community leaders.
Another stand-out deal was the first ever syndicated sustainability-linked pre-export finance facility in Russia’s metals and mining sector for Rusal, closed just months after sanctions on the borrower were lifted.
The bank has also had a strong showing in supporting the growth of climate-friendly technologies, with the co-ordination of an unprecedented multisource financing in Guinea for the production of bauxite to support the production of aluminium used in wind, solar and energy storage, as well as the execution of a tailor-made structure for a transformational financing in Australia for the single largest global supplier of lithium, a strategic metal used for batteries in electric vehicles.
Best export finance bank: Standard Chartered
For the third year in a row, Standard Chartered is the GTR Leaders in Trade best export finance bank, thanks to its track record of bringing innovative and bespoke structured export finance transactions to the market.
Over the last three years, the bank’s export finance team, located in the US, UK, UAE, Korea, Japan, Singapore and China, has arranged over US$30bn of export credit agency (ECA), multilateral, and development finance institution (DFI)-supported financing across its footprint markets in the Middle East, Africa and Asia.
Getting innovative treatment of national content and providing support to help navigate exporters through complex ECA re-insurance structures has been a hallmark of Standard Chartered’s work in the space. For example, as ECA co-ordinator and mandated lead arranger for a port operator in Nigeria, with Belgian and Italian exporters contracted out of Cyprus and Hong Kong respectively, the bank obtained flexible treatment from both Credendo and Sace on the basis of the national interest for both contracts.
“Through our expertise of the ECA market and supply chain across the globe, Standard Chartered can help identify, where available, support from a wider network of ECAs and reinsuring ECAs to maximise the ECA facility amount,” the bank says.
Last year also saw Standard Chartered carry out a number of landmark World Bank Group and other multilateral agency supported deals, including the largest-ever Multilateral Investment Guarantee Agency (Miga) transaction to date with Oman’s ministry of finance, in which it served as global co-ordinator, facility and Miga agent.
Best trade finance bank: HSBC
HSBC continues to stand out from its trade finance competitors on a global scale. With over 6,000 trade experts across 56 markets, the bank facilitates US$750bn of trade each year.
In 2019, through significant investment and collaboration with a broad stakeholder base of fintechs, other banks, industry specialists, regulators and governments, HSBC played a key role in the transformation of trade with a series of industry firsts.
But it is not just technology that makes HSBC a leader in its field. Its ground-breaking sustainable supply chain finance programme with US retail giant Walmart, launched in April, put it squarely at the forefront of the fight against climate change. What is unique about this sustainable supply chain finance programme is that the rate at which HSBC discounts the suppliers’ invoices depends not only on Walmart’s credit standing, but also on Walmart’s supplier rating, which is applied after the retailer has monitored a supplier’s adherence to various social and environmental standards.
Also deserving of a mention is the bank’s work to tackle the trade finance gap by seeking out new sources of liquidity. In May last year, HSBC teamed up with Allianz Global Investors (AllianzGI) to wrap trade finance assets into notes, in the first trade finance securitisation initiative of its kind. “Global demand for trade finance already outstrips supply by about US$1.5tn a year,” says Surath Sengupta, HSBC’s global head of trade portfolio management. “We see huge potential for a thriving secondary market to stimulate trade in goods and services – the lifeblood of the global economy.”
According to him, the bank is aiming for nothing less than a “major reform” of the trade finance market in the coming years.
